San Jose-based Nutanix raises $140 million as it readies for 2015 IPO

SAN JOSE -- A data storage company experts say is on track to become the next Oracle announced Wednesday a new round of funding that pushes its value to more than $2 billion.

Nutanix, a tech firm that offers organizations from the U.S. Army to Toyota services to store and manage huge amounts of data, raised $140 million, its largest funding round since the company was founded in 2009. The investment more than doubled the company's worth, which was estimated at $1 billion in January, and helps pave the way for an initial public offering likely next year.

According to sources familiar with the deal, the investment was led by Fidelity and Wellington, behemoth financial institutions based in Boston -- a sign of the company's strong growth, experts said. Financial management firms tend to get involved only in the less risky tech investments, not the scrappy upstarts that could fail at any minute.

"I have been with the company since day minus-one," said Bipul Sinah, a VC with Lightspeed Ventures who was the first Nutanix investor in late 2009. "The company has grown extremely rapidly, and it has defied all revenue expectations and all growth expectations. This is the next big Silicon Valley company. They are the fastest-growing enterprise infrastructure company in the last 15 years. The company has the opportunity to become the next VMware or Oracle. The sky is the limit."

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The San Jose-based company is private, but Chief Financial Officer Duston Williams said Nutanix is growing 200 percent year-over-year. It has about 800 customers, more than 650 employees and offices around the world, from Australia to the Netherlands.

Nutanix sells services that helps companies store massive amounts of data without slowing down their operations, delaying responses to customers, or creating buggy and cumbersome Web processes, Williams said. The company offers data processing and analytics tools similar to that of Google and Facebook, which manage huge amounts of consumer information, to companies that might not be as tech-oriented: the U.S. Postal Service, the U.S. Navy, ConocoPhillips and Honda.

"We have had a lot of success selling to the federal government," Williams said.

But it also counts some tech companies among its customers, such as eBay and Yahoo Japan.

The $140 million investment puts Nutanix's fundraising at $312 million, and marks the second big-dollar funding round this year. In January, the company raised a little more than $100 million from venture capital firms including Khosla Ventures, Battery Ventures and Lightspeed Venture Partners.

A Nutanix IPO has been expected for months, but Williams said the company won't start the process of going public until 2015 at the earliest. Experts say the company is waiting for market jitters to ease so they can raise potentially hundreds of millions of dollars.